Zinox recently acquired e-commerce site Konga following claims of a supposed restructuring or perhaps, a shortage of financial backup to keep the company moving. The country has experienced a phase of economic instability which has affected entirely of some firms, including Etisalat and OLX. It, therefore, doesn’t come as a surprise that the new Konga and Yudala have merged or are proposing a merger (since there’s yet to be an official statement).
Punch Nigeria reported that that the merger was part of a strategy to build a stronger and better brand to ward off their biggest competitor, Jumia. With both infrastructures combined, they can attain market leadership in the e-commerce industry.
A merger between both firms will be a game changer for the e-commerce industry in Nigeria. After the departure of OLX and former Konga, Jumia has been without competition. Moreover, following complaints from some unsatisfied online shoppers who allege that the site sells counterfeit products, the two firms proposing a merger could likely use this flaw to their advantage.
With both strengths combined, they can improve customer experience by enforcing more stringent rules and policing the sellers’ products to ensure there are no counterfeits. They can also expand the access to a broader range of products and services to create more convenience for shoppers. More and more people are choosing to shop online other than the traditional method of walking around the stores. Buying online provides comfort and helps you save time for other chores.
On the whole, shopping online is beneficial to both buyers and sellers. It’s relatively expensive to have a physical store as one would have to bother about monthly or yearly payments as well as other nitty-gritty to make the store attractive or welcoming. Buyers, on the other hand, do their shopping from the comfort of their homes and still receive their items at their doorsteps.
The Lead Partner, Infusion Lawyers, Senator Ihenyen commented that the merger would benefit both brands as each of them will leverage on their strengths to attain leadership in the e-commerce industry. While Yudala will leverage on Konga’s massive subscribers to market its products, Konga will benefit from Yudala’s physical stores. So, in essence, it will be a win-win situation for both firms.
Although many Nigerians are still wary of the idea of shopping online, it’s only a matter of time before a turn of events take place. Just like President Trump accused Amazon of taking the jobs from brick and motor stores in the U.S, the same fate will fall on vendors in physical stores in a short while.